Medicare Part B
Medicare Made Easy
Medicare Part B
Medicare Part B (which is medical insurance) is part of Original Medicare and covers medical services and supplies that are medically necessary for treating your health condition. This may include outpatient care, preventive services, ambulance services, and durable medical equipment (DME). It will also cover part-time or intermittent home health and rehabilitative services, like physical therapy, if they are prescribed by a doctor for treating your condition.
Medicare Part B also covers more expensive services that sometimes occur in the hospital. This includes services like radiation or chemotherapy for cancer, surgeries, diagnostic imaging, medical equipment, and even dialysis for failing kidneys. Part B will also pay for drugs administered in a clinical setting, like osteoporosis injections, infused drugs, antigens, and insulin that is used with an insulin pump. Otherwise, outpatient drugs fall under Part D.
Some preventive services are also covered by Medicare Part B including a one-time “Welcome to Medicare” preventive visit, flu and hepatitis B shots, cardiovascular screenings, cancer screenings, diabetes screenings, colonoscopies, mammograms, and more. For a full list of the preventive services covered under Medicare Part B, please refer to the Medicare handbook, “Medicare and You.”
Of course, Part B is optional, however, if Medicare is your primary coverage, you need Part B. Also, you cannot get Medigap supplemental coverage without it.
Medicare Part B covers 80% of approved costs after you first pay the annual deductible.
Eligibility for Medicare Part B
Whoever is eligible for premium-free Medicare Part A is eligible for Medicare Part B by enrolling and paying a monthly premium. If you are not eligible for premium-free Medicare Part A, you can qualify for Medicare Part B by meeting the following requirements:
- You must be 65 years or older.
- You must be a U.S. citizen, or a permanent resident lawfully residing in the United States for at least five consecutive years.
You can also qualify for automatic Medicare Part B enrollment through disability. If you are under 65 and receiving Social Security or Railroad Retirement Board (RRB) disability benefits, you will automatically be enrolled in Medicare Part A and Part B after 24 months of disability benefits. You may also be eligible for Medicare Part B enrollment before 65 if you have end-stage renal disease (ESRD) or amyotrophic lateral sclerosis (also known as ALS, or Lou Gehrig’s disease).
When to enroll in Medicare Part B
If you are receiving retirement benefits before age 65 or qualify for Medicare through disability, generally you’re automatically enrolled in Medicare Part A and Part B as soon as you become eligible.
If you do not enroll during your initial enrollment period and do not qualify for a special enrollment period, you can also sign up during the annual General Enrollment Period, which runs from January 1 to March 31, with coverage starting on July 1. You may have to pay a late enrollment penalty for not signing up when you were first eligible.
If you’re not automatically enrolled, you can apply for Medicare through Social Security, either in person at a local Social Security office, through the Social Security website, or by calling 1-800-772-1213 (TTY users 1-800-325-0778) from 7 AM to 7 PM, Mon through Fri.
Keep in mind that once you are both 65 years or older and have Medicare Part B, your six-month Medigap Open Enrollment Period will begin. This is the best time to purchase a Medicare Supplement (Medigap) insurance plan because, during the open enrollment, you will have a “guaranteed-issue right” to buy any Medigap plan without medical underwriting or paying a higher premium due to pre-existing conditions. Once you are enrolled in Medicare Part B, be careful not to miss this one-time initial guaranteed-issue enrollment period for a Medicare Supplement.
Delaying Medicare Part B enrollment
Some people may get Medicare Part A “premium-free,” but most folks have to pay a monthly premium for their Medicare Part B. Because Medicare Part B comes with a monthly premium, some people may choose not to sign up during their initial enrollment period if they are currently covered under either their own or through their spouse’s employer, an employer health group plan (EGHP).
If you are still employed, you should check with your health benefits administrator to see how your insurance would work with Medicare. If you delay enrollment in Medicare Part B because you already have current employer health group coverage, you may sign up later during a Special Enrollment Period (SEP) without paying a late penalty. You can enroll in Medicare Part B at any time that you are still covered by a group plan based on your current employment. After your employer health coverage ends or your employment ends (whichever comes first), you have an eight-month SEP to sign up for Part B without incurring a late enrollment penalty.
Keep in mind that retiree coverage and COBRA are not considered health coverage based on current employment and would not qualify you for a SEP. If you have COBRA after your employer coverage ends, you should not wait until your COBRA coverage ends to sign up for Medicare Part B. Your eight-month Part B special enrollment period begins immediately following when your current employment or group plan ends (whichever comes first). This is regardless of whether you get COBRA.
Medicare Part B Late Enrollment Penalty
If you failed to sign up for Medicare when you were first eligible, and you didn’t have any creditable coverage, you are subject to the Medicare Part B late enrollment penalty. The late enrollment penalty (also called the “LEP” or “penalty”) is an amount that may be added to a person’s monthly premium for Medicare drug coverage
(Part D). A person enrolled in a Medicare plan may owe a late enrollment penalty if they go without Part D or other creditable prescription drug coverage for any continuous period of 63 days or more after the end of their Initial Enrollment Period for Part D coverage.
Generally, the late enrollment penalty is added to the person’s monthly Part D premium for as long as they have Medicare drug coverage, even if the person changes their Medicare plan. The late enrollment penalty amount
changes each year. The cost of the late enrollment penalty depends on how long the person went without Part D or other creditable prescription drug coverage.
When you do finally enroll, you’ll need to wait for the Medicare General Enrollment Period to sign up for Part B. This period runs from January 1st to March 31st each year. Your benefits will then begin the following July. This can be a double whammy because not only do you now owe a penalty, but you must wait several months for your coverage to kick in.
If you enrolled late because you’ve had employer group health coverage from a company with 20 or more employees, you will not be subject to the Medicare Part B late enrollment penalty. When you leave that coverage, you have 8 months to sign up for Part B. This is called your Special Enrollment Period for Medicare.
The best way to avoid the Medicare Part B late enrollment penalty is to enroll in Medicare during your Initial Enrollment Period
Medicare Part B premiums
Medicare Part B premiums may change from year to year, and the amount can vary depending on your situation. For many people, the premium is automatically deducted from their Social Security benefits.
The standard Part B premium amount in 2023 is $164.90. Most people pay the standard Part B premium amount. If your modified adjusted gross income as reported on your IRS tax return from 2 years ago is above a certain amount, you’ll pay the standard premium amount and an Income Related Monthly Adjustment Amount (IRMAA). IRMAA is an extra charge added to your premium.
If your income exceeds a certain amount, your premium could be higher than the standard premium, as there are different premiums for different income levels.
See below for more details about the Medicare Part B premium.
If you are receiving Social Security, Railroad Retirement Board, or federal retirement benefits, your Part B premium will be deducted directly from your monthly benefit. If not, you will be sent a bill every three months.
The chart below shows the Medicare Part B monthly premium amounts, based on your reported income from two years ago (2021 in this example). These amounts may change each year. A late enrollment penalty may be applicable if you did not sign up for Medicare Part B when you were first eligible. Your monthly premium might be 10% higher for each 12-month period that you were eligible for but didn’t enroll in Part B.
The 2023 Part B total premiums for high-income beneficiaries are shown in the following table:
Full Part B Coverage
Beneficiaries who file individual tax returns with modified adjusted gross income:
Beneficiaries who file joint tax returns with modified adjusted gross income:
Income-Related Monthly Adjustment Amount
Less than or equal to $97,000
Less than or equal to $194,000
Greater than $97,000 and less than or equal to $123,000
Greater than $194,000 and less than or equal to $246,000
Greater than $123,000 and less than or equal to $153,000
Greater than $246,000 and less than or equal to $306,000
Greater than $153,000 and less than or equal to $183,000
Greater than $306,000 and less than or equal to $366,000
Greater than $183,000 and less than $500,000
Greater than $366,000 and less than $750,000
Greater than or equal to $500,000
Greater than or equal to $750,000
Part B deductible & coinsurance
In 2023, you pay $233 for your Part B deductible. After you meet your deductible for the year, you typically pay 20% of the Medicare-approved amount for these:
- Most doctor services (including most doctor services while you’re a hospital inpatient)
- Outpatient therapy
- Durable Medical Equipment (DME)
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